DECISION REQUESTED ADDITIONAL INFORMATION REGARDING A COMPLAINT AND A MOTION FOR INJUNCTIVE RELIEF RELATED TO COMMON CARRIAGE OF SPECIFIED CHEMICAL CARGO. IT ALSO PROVIDES FOR DEVELOPMENT OF A SINGLE RECORD FOR THIS AND ANOTHER PROCEEDING THAT RAISES SIMILAR ISSUES.

Digest:[1]This decision requests additional information
regarding a complaint and a motion for injunctive relief related to common
carriage of specified chemical cargo.It
also provides for development of a single record for this and another
proceeding that raises similar issues.

Decided:September
28, 2011

In
the 2 captioned dockets, several chemical shippers and trade associations
(collectively, shippers) challenge certain requirements for rail transportation
of Toxic-by-Inhalation Hazardous materials and Poison-by-Inhalation Hazardous
materials (TIH/PIH) promulgated by RailAmerica, Inc.
(RailAmerica) and several of its railroad
subsidiaries.In light of the apparent factual
and legal overlap between the 2 cases and to ensure ample opportunity for input
by all interested persons and the general public, the Board will address these
issues in a single record in the declaratory order proceeding in Docket No. FD 35517.In Docket No. NOR 42129, complainants are directed to file,
within 15 days of the date of service of this decision, supplemental
information clarifying briefly what specific practices they are currently challenging
and seeking to enjoin.Replies may be
filed 15 days later.Thereafter, the
Board will rule on complainants’ injunction request.Following the Board’s
ruling, Docket No. NOR 42129 will be held in abeyance pending issuance
of the Board’s final decision in Docket No. FD 35517 after
public comment.

BACKGROUND

As discussed below, the issues in these dockets are substantially
similar because the shippers in both cases appear to challenge the same tariff
requirements and the same RailAmerica Standard
Operating Practice (SOP) for handling TIH/PIH materials.The primary difference between these
proceedings is that Docket No. NOR 42129 arises from a
complaint, in which specific relief is sought, while Docket No. FD 35517
arises from a petition for declaratory order, in which general guidance is
sought.

1. Docket No. NOR 42129

On
April 15, 2011, American Chemistry Council, The Chlorine Institute, Inc., The
Fertilizer Institute, and PPG Industries, Inc. (collectively, complainants) filed
a complaint in Docket No. NOR 42129 against Alabama Gulf
Coast Railway (AGR) and RailAmerica (collectively,
defendants).Complainants request
a determination by the Board that the SOP, as well as a “special train service”
allegedly required by AGR, is an unreasonable practice under 49 U.S.C. § 10702
and a violation of the common carrier obligation under 49 U.S.C. § 11101,
and they ask that the Board enjoin those practices.

·A special permit for
TIH required to be tendered to AGR no less than 5 days prior to interchange;
and

·A limitation of
no more than 3 TIH railcars per dedicated train.

With
respect to the first of these items, complainants further allege that the “special
train service” set forth in AGR Tariff 0900, as further described in the SOP,
requires that (1) RailAmerica subsidiary railroads,
including AGR, move TIH at no more than 10 miles per hour; (2) each TIH car be
inspected by a qualified mechanical employee before the car is pulled from the
interchange track; and (3) employees of the RailAmerica
subsidiary railroad accompany the TIH shipment at all times while on RailAmerica property and until the receiver has
acknowledged receipt.

In
response to the complaint, defendants filed an answer and a motion to dismiss
on May 5, 2011.In both filings,
defendants state that AGR Tariff 0900 was canceled on April 29, 2011 (canceled
tariff), and that AGR Tariff 0900-1 was instead adopted on the same day
(replacement tariff).Defendants argue
that replacement tariff 0900-1 substantially modifies the canceled tariff.Further, defendants contend that the SOP is
not binding or enforceable as a tariff, and that it is intended simply to open
a dialogue between AGR and affiliated railroads and shippers of TIH/PIH
materials.They claim that the SOP only
recommended certain actions, such as a speed limit and inspection,
accompaniment, and permitting provisions.

The
table below compares the 2 tariffs:

Provision

canceled tariff (0900)

replacement tariff (0900-1)

Train service (name)

“Special train service”
– dedicated train and crew.

“Priority train service”
-- “More expeditious service” than the normal course of business to receiver.

Permit/Notice

Special permit –
tendered to AGR no less than 5 days before interchange

Notice form – tendered
to AGR with date AGR requested to take possession

Car limit

1-3 TIH/PIH cars per
train

1-3 TIH/PIH cars per
train

Speed Limit

10 m.p.h. (per the
SOP, according to complainants).

No specific speed
limit – reasonable speed for conditions

Inspection

RailAmerica qualified mechanical employee to inspect each car
at interchange (per the SOP, according to complainants)

AGR employees must
accompany TIH shipments at all times while on railroad property (per the SOP,
according to complainants)

None

The
comparison shows several differences between the 2 tariffs.On May 16, 2011, complainants filed a reply
to defendants’ motion to dismiss.Complainants state that they do not seek to enjoin the actions of AGR
alone, or a specific tariff or items issued by AGR alone, but instead seek more
broadly to enjoin as an unreasonable practice the SOP and the “special train
service” required by AGR.

2.Docket No. FD 35517

In Docket No. FD 35517, CF Industries, Inc. (CF) filed a petition for declaratory
order on May 17, 2011, requesting that the Board declare invalid and
unenforceable certain tariffs addressing the movement of TIH/PIH materials issued
by the Indiana & Ohio Railway Company (IORY), the Point Comfort and
Northern Railway Company (PCN), and the Michigan Shore Railroad, Inc. (MSR) (collectively,
the RailAmerica railroads), as well as any associated
implementation procedures under the SOP. The challenged tariffs are identical to the
replacement tariff in Docket No. NOR 42129, other than the actual rates
charged.

On
June 6, 2011, the RailAmerica railroads replied,
requesting that the petition be denied and contending that the declaratory order
process is inappropriate in this case.The RailAmerica railroads argue that: (1) CF
should be required to file a complaint under 49 U.S.C. § 10702(b), instead of
petitioning for a declaratory order; (2) there is no case or controversy here that
needs to be resolved under the declaratory order process, and the SOP is
without force and effect; and (3) a reference in CF’s petition to the transportation
charges in the challenged tariffs is actually a thinly veiled rate
reasonableness complaint that should be litigated under 49 U.S.C. §§ 10701 and
10707.The RailAmerica
railroads also assert that the SOP is simply a presentation intended to open a
dialogue between the RailAmerica railroads and
shippers of TIH/PIH materials and that it has no binding effect.They note that the RailAmerica
railroads’ tariffs adopted different processes than those in the SOP with
respect to train speed and notice of shipment.

PRELIMINARY MATTERS

1.Docket No. NOR 42129

In Docket No. NOR 42129, defendants moved to dismiss the complaint on the basis that
AGR has canceled the originally challenged tariff, AGR Tariff 0900.Defendants contend that in light of this
cancellation, the complaint no longer presents a case or controversy for the
Board to resolve.Defendants also moved
to dismiss RailAmerica as a defendant, arguing that RailAmerica is not a rail carrier subject to the Board’s
jurisdiction.The Board is requesting
supplemental information in connection with the complaint and the request for
injunctive relief, and after the Board rules on the motion for injunctive
relief, it will hold Docket No. NOR 42129 in abeyance
pending issuance of the Board’s final decision in Docket No. FD 35517,
as discussed below.Accordingly,
defendants’ motion to dismiss will be addressed in a later decision.

On
June 13, 2011, Arkema Inc. (Arkema)
filed a Petition for Leave to Intervene.Defendants filed a reply on July 12, 2011, opposing Arkema’s
petition.While Docket
No. NOR 42129 is held in abeyance, Arkema’s petition will be similarly held in abeyance.However, Arkema,
like all interested persons and the general public, will have an opportunity to
participate in the declaratory order proceeding in Docket No. FD 35517.If necessary, Arkema’s petition for leave
to intervene in Docket No. NOR 42129 will be addressed in a later decision.

2.Docket No. FD 35517

On
June 20, 2011, CF requested leave to file a reply to the RailAmerica
railroads’ reply in Docket No. FD 35517.The RailAmerica railroads
responded to CF’s request on July 11, 2011, asking the Board to reject the
request and arguing again that a declaratory order proceeding is unnecessary.In the interest of compiling a more complete
record, we will accept the surreplies.

On
June 6, 2011, Edison Electric Institute (EEI) requested leave to file a letter
as amicus curiae in Docket No. FD 35517.The RailAmerica railroads
filed a reply on June 27, 2011, requesting that the Board deny EEI’s request
and strike the amicus letter from the record.In this decision, the Board is instituting a
declaratory order proceeding in Docket No. FD 35517 to provide an
opportunity for the parties in both cases, all other interested persons and the
general public to participate in developing a single record.Therefore, EEI’s request for leave to file
its letter is granted.

DISCUSSION AND CONCLUSIONS

1.Need for Clarification
in Docket No. NOR 42129

The complaint
and request for injunctive relief are not premised solely on the SOP, and it is
unclear whether the challenge encompasses tariff provisions that have been
changed.Compare Motion for
Injunctive Relief at 7 (asking the Board to “enjoin the RailAmerica
SOP and its resulting tariffs by RailAmerica
subsidiaries . . .”) with Complainants’ Reply to Motion to Dismiss filed
May 16, 2011 at 7-8 (stating that complainants do not challenge the actions of
AGR alone, or a tariff or items issued by AGR alone, but instead challenge the
SOP and “special train service”).For example,
the replacement tariff specifically eliminates (1) any reference to the SOP;
(2) the 10 mile per hour speed limit for trains carrying TIH cars; and
(3) reference to a dedicated train and crew.In addition, it is unclear whether the
replacement tariff’s “priority train service” is substantially different from
the canceled tariff’s “special train service,” and, if so, in what respects.

These
changes raise questions about exactly what practices complainants are
challenging and seeking to enjoin.Thus,
complainants are directed to file supplemental information in Docket No. NOR
42129 clarifying briefly what specific practices, whether found in the SOP,
replacement tariff, or elsewhere (including the actual tariff or other items
that are the subject of the request for injunctive relief), they are
challenging and seeking to enjoin by October 17, 2011.Replies will be due on October 31, 2011.We will rule on complainants’ injunction
request after the requested supplemental information and any replies have been
filed.

2.Reasons for Instituting a Declaratory
Order Proceeding in Docket No. FD 35517 to Develop a Single Record on the
Remaining Issues

In both proceedings, the
tariffs involved – i.e., AGR replacement tariff 0900-1 (if complainants
in Docket No. NOR 42129 intend to challenge the replacement tariff), IORY
Tariff 0900, PCN Tariff 0900, and MSR Tariff 0900 – share common substantive
terms.Moreover, each of the tariffs appears
to integrate some of the provisions of the SOP or could do so, as complainants
allege AGR did in the cancelled tariff.Thus, the relevant facts concerning the practices of the defendant
railroads appear to be substantially the same.

The
basic controversies also appear to be the same, although presented to the Board
as different types of proceedings.Many
of the legal issues before us here likely will involve the same statutes – 49
U.S.C. § 10702 (unreasonable practice) and § 11101 (violation of the
common carrier obligation).The parties’
arguments on the merits in both cases are also likely to be similar.The same precedent should therefore apply to
both cases.

Finally,
the legal issues presented may ultimately affect not only the parties to the 2 cases
before the Board, but others within the industry that transport, handle,
receive, or ship TIH/PIH.Thus, the
Board’s determination in either of these cases is likely to resolve similar
issues that might be raised in future proceedings.

Accordingly,
good cause exists to address the issues raised in both cases in one proceeding
and to allow for broader public input.To
do so, the Board is instituting a declaratory order proceeding in Docket No. FD 35517, in which the parties in that docket as well as Docket No.
NOR 42129 and any other interested persons and the general public may
participate, to allow a single record to be developed for both cases.The complaint proceeding, Docket
No. NOR 42129, will be held in abeyance
following the Board’s ruling on complainants’ motion for injunctive relief.Following resolution of the declaratory order
proceeding, complainants will have the opportunity to seek appropriate relief,
if any, in Docket No. NOR 42129, based on the record developed in Docket No. FD 35517.

In Docket No. FD 35517, the RailAmerica railroads contend
that the declaratory order process is inappropriate and that CF should be
required to file a complaint under 49 U.S.C. § 10702(b).[3]But under 5 U.S.C. § 554(e) and 49
U.S.C. § 721, the Board has broad discretion to issue a declaratory order
to terminate a controversy or remove uncertainty.[4]Here, the complainants in Docket No. NOR 42129 and the petitioner in Docket No. FD 35517 seek guidance regarding the validity and enforceability of requirements
related to the transportation of TIH/PIH materials.Moreover, as noted, the issues raised in both
proceedings may affect others in the industry that either handle or ship
TIH/PIH.Providing a single forum for
all interested persons and the general public to address the issues presented
by CF and complainants will contribute to administrative efficiency.Thus, a petition for declaratory order is an
appropriate procedural mechanism to address the common issues presented in
these cases.[5]

Pursuant
to the Board’s authority under 5 U.S.C. § 554(e) and 49 U.S.C. § 721,
a proceeding will be instituted to resolve the controversies at issue
here.Any person who wishes to
participate in this proceeding as a party of record (POR) must file, no later than
October 17, 2011, a notice of intent to participate and must adhere to the
procedural schedule established in the Appendix.To ensure each POR receives all filings, the
Board will serve, as soon as practicable, a notice containing the official service
list (the service-list notice).Each POR
will be required to serve upon all other PORs, within 10 days of the service
date of the service-list notice, copies of all filings previously submitted by
that party (to the extent such filings have not previously been served upon
such other parties).[6]Each POR also will be required to file with
the Board, within 10 days of the service date of the service-list notice, a
certificate of service indicating that the service required by the preceding
sentence has been accomplished.

Although
the legal nature of a declaratory order proceeding might not always necessitate
discovery, because of the factually intense nature of the dispute here and
because the record that will be developed will govern not just the declaratory
order case in Docket No. FD 35517 but the complaint case in
Docket No. NOR 42129 as well, we will permit discovery among complainants,
defendants, CF, the RailAmerica railroads, and any
other shippers potentially affected by the challenged practices, including
shipper organizations that represent those shippers.These entities may conduct discovery pursuant
to the Board’s regulations at 49 C.F.R. § 1114.21, et seq.

This
decision will not significantly affect either the quality of the human
environment or the conservation of energy resources.

It is ordered:

1.Complainants
are directed to file supplemental information in Docket No. NOR 42129
clarifying briefly what specific practices, whether found in the SOP,
replacement tariff, or elsewhere (including the actual tariff or other items
that are the subject of the request for injunctive relief), they are
challenging and seeking to enjoin by October 17, 2011.Replies are due on October 31, 2011.

2.The request for institution of a declaratory
order proceeding is granted, and a declaratory order proceeding under 5 U.S.C.
§ 554 and 49 U.S.C. § 721 is instituted in Docket No. FD 35517.

3.The parties to the proceedings in Docket Nos.
FD 35517 and NOR 42129 shall comply with the procedural requirements described
in this decision and the procedural schedule shown in the Appendix.

4.EEI’s request for leave to file a letter as amicuscuriae is granted.

5.CF’s June 20, 2011 filing and the RailAmerica railroads’ July 11, 2011 filing are accepted.

[1]The digest
constitutes no part of the decision of the Board but has been prepared for the
convenience of the reader.It may not be
cited to or relied upon as precedent.Policy
Statement on Plain Language Digests in Decisions, EP 696 (STB served Sept.
2, 2010).

[2]AGR Tariff
0900 was not submitted into the record.The
discussion of the provisions of the 0900 tariff in this decision is based on
the complainants’ representations.Defendants
submitted copies of the SOP and the subsequently adopted AGR Tariff 0900-1 as
exhibits to their Response to Motion for Injunctive Relief, filed May 9, 2011.

[3]The RailAmerica railroads argue that a party should be required
to use the more specific complaint process when it is available, rather than the
more general declaratory order process, citing Entergy Arkansas, Inc. v.
Union Pacific Railroad, NOR 42104, slip op. at 1-2 (STB served June 26,
2009).That decision, however, does not
address whether a party must file a complaint as opposed to seeking a
declaratory order.For the reasons
discussed in this decision, allowing a single record to be developed in Docket
No. FD 35517 is an appropriate way to address the issues raised in these cases.

[5]The RailAmerica railroads’ contention that CF’s reference to
the transportation charges in the challenged tariff provisions turns this into
essentially a rate reasonableness complaint would not, even if correct,
preclude a declaratory order proceeding.CF’s petition is not limited to arguments regarding costs, but rather
encompasses a variety of practices.

[6]Service may be
made by e-mail if service by e-mail is acceptable to the recipient.